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Ian McKenna: How to choose the right practice management system

It’s important to buy a system you need rather than be sold the wrong solution

The recent eAdviser benchmarking from Intelliflo provided for the first time compelling evidence that UK advice firms who use more technology can support more customers, have far higher assets under advice and a higher percentage of recurring fee clients.

Consequently, it makes more sense than ever for advisers to make sure they have the best practice management system for their needs.

Judging by the number of calls my office gets from advisers asking for guidance on this, more firms than ever are reviewing their options. This week I want to provide some help on how to take such decisions effectively and buy the system you need, rather than being sold the wrong solution.

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Choosing technology is similar to taking financial advice. There are a bewildering range of options and taking the wrong decisions can have severe consequences. It’s also valuable to start with a fact-finding process to make sure all the relevant information is considered.

My advice is don’t start talking to any potential supplier until you have a clear understanding of your priorities and what you want a system to deliver. Software company sales teams know exactly what the most attractive looking features in their systems are and will be quick to guide you towards these. You don’t want the latest flashy toy, you want the offering that will most help your business.

To achieve a successful technology deployment, it is crucial to win the support of the people you want to be using it, ie your own staff. Human beings are naturally resistant to change so it’s essential to communicate how and why implementing a new system will be beneficial for them.

A key part of such a process is making sure each area within your business is represented in the requirements process. For very small firms that probably means asking each person in the company for their views, in larger organisations make sure each department is represented.

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It can be hard to identify your priorities and balance these between each area of the business. One technique I’ve seen used effectively is to get each person or department involved in a process to write three lists. Firstly, the things that, if improved, would do the most to make their lives easier. Second, list things that would be nice to have, but are not essential, and finally what would be the changes that would do most to enhance how you can service clients.

Then look at how frequently the same features recur on these lists from different parts of the business. Your most important requirements are probably going to come from lists one and three but if the same thing keeps coming up in the second list it should probably be on the requirements list too.

Human beings are resistant to change so it’s essential to communicate how implementing a new system will be beneficial

By collating the different priorities from different areas of your business it should start to emerge what will be most valuable. Once you have refined this to a summary of your key priorities, write to prospective suppliers asking them how they can address each of the things that are most important to you.

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From the responses create a shortlist of firms who appear to have the best capability to support your priorities and only then invite them to provide a presentation. When you see suppliers, don’t let the salesperson show you the part of their system they want to – make sure they demonstrate the features you have identified as most important to your business.

Before you sign up with anyone make your own independent enquiries about what it is like to use their system. Don’t take references from the system suppliers – they know which of their users are their best advocates – seek out existing users of their system to talk to. An increasing number of social media groups have discussions on this.

As to who to include in your process, I gave a brief overview of the functionality of various suppliers back on April 19 in this column. As a very quick guide, three systems should probably be included in any such process: Intelliflo, Iress and Focus. If you are looking for strong customer relationship management capabilities Time4Advice and the latest offering from Plum are worth looking at too.

Firms looking for a deeply-integrated platform should look at Benchmark Capital’s Creative Technology offering and True Potential. Other names to consider would include 360DotNet, Assyst, Bluecoat, Durell, Hourglass, JCS Software, Prestwood, Synaptic Client Care and SSP Adviser.

For further guidance I would also recommend viewing the video of Adam Higgs presenting on choosing the right adviser software at last year’s Festival of Financial Planning. When you have chosen your system make sure you agree a clear implementation process, and most important of all training. If you skimp on the training your technology project will fail.

Ian McKenna is director of the Finance & Technology Research Centre

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There is one comment at the moment, we would love to hear your opinion too.

  1. Good article. I would chip in and say be honest about the resources of your practice in terms of time and budget. There are some brilliant systems out there but as we have found out they can be time and cost expensive where as another system can do 95% of what you need it to do.

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